If you are relatively new to the estate planning process, you are likely to find yourself asking “What is a joint living trust?” In short, a joint living trust is a legal document that stipulates an arrangement between two close people (generally spouses) who want to make joint decisions and establish firm guarantees involving the management and distribution of their assets while they are still alive and after their eventual deaths.

Joint Living Trusts vs. Individual Living Trusts

Also called a shared living trust, a joint living trust applies to both spouses and includes legally binding provisions that detail specific management and/or distribution actions to be undertaken upon the death of each. By reading on, you can learn about the various advantages and disadvantages of taking this approach to estate planning.

Joint living trusts differ in important ways from individual living trusts, which apply to a single person only. Both unmarried people and married people may establish an individual living trust.

Revocable vs. Irrevocable Living Trusts

When couples choose to establish separate individual living trusts, each of these trusts become irrevocable after its grantor passes away. This often leaves the surviving partner with limited control over the assets of the deceased.

A joint living trust, however, is generally revocable as long as either partner is alive. This gives any spouse who outlives his or her partner the legal right to manage the couple’s remaining assets as he or she sees fit. Joint trusts only become irrevocable when both partners are dead.

Who Should Have a Joint Living Trust?

Married people benefit from a joint living trust when they want flexibility in their financial planning and full control over their financial assets. In many cases, joint living trusts also offer attractive tax benefits. Furthermore, couples can generally lower the costs associated with trust maintenance as general administration processes are typically far easier and more streamlined with a joint living trust.

Despite their many advantages, joint living trusts have their drawbacks as well. For example, joint trusts tend to offer little asset protection in cases that involve creditor actions or legal judgments against a spouse.

Who Can Prepare a Joint Living Trust?

After conducting a little independent research, you will want to secure the services of a legal and/or financial professional who specializes in estate planning. A good estate planning specialist can help you decide if a joint living trust or an individual living trust is right for you.

With your estate plan in place, you can proceed to prepare and file the necessary paperwork. To ensure that your joint living trust is legally binding, both you and your partner will need to sign it in front of a certified public notary.

To Streamline Legal Signing Processes

First Class Signing Services (FCSS) can help you prepare your legal documents without paying the exorbitant fees that are charged by most law firms and attorneys. For more information about FCSS and its document prep services, contact a knowledgeable company representative today.

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